Electronic advertising refers to the presentation of advertising messages promoting a cause—such as a product, service, or service provider—to one or more people via an electronic device. Electronic advertising messages often have a visual component. It is typical for an advertiser to pay for the opportunity to present an advertising message. Those presenting advertising messages to people on behalf of advertisers are called publishers. Often, publishers join advertising messages they are presenting with other content, such as a web page requested by a person.
As one example, the publisher of web pages each containing information about a different home in a particular geographic area may sell the opportunity to include in served copies of these web pages advertising messages on behalf of real estate agents who are active in the geographic area.
A single opportunity to present an advertising message—such as including the advertising message in a copy of a web page served to a single device at a particular time—is called an impression.
In some cases, publishers sell impressions by setting a fixed per-impression price, and allocating impressions uniformly across a set of participating advertisers.
In some cases, publishers sell impressions by conducting an auction in which, for a particular category of impressions, advertisers each bid a price to be able advertise using these impressions. Generally, the advertiser who bids the highest price is able to purchase as many of these impressions as it wishes. To the extent that the highest-bidding advertiser does not consume all of the impressions, the second-highest-bidding advertiser is able to purchase as many of the remaining impressions as it wishes, and so on.